The headline on the front page of the Straits Times (14 May 2013) said “Khaw: Town councils political by nature”.
It explains nothing.
A country’s government is also political by nature. It doesn’t mean that the government can sell the Finance Ministry’s tax-collection software to a party-owned vehicle.
That is the chief issue which the National Development Ministry’s review report on town councils and the debate in parliament (13 May 2013) failed to address.
The controversy dates to December 2012 when I highlighted the fact that town councils run by the People’s Action Party (PAP) sold the intellectual property rights to their management software to Action Information Management Pte Ltd (AIM), a company whose beneficial owner is none other than the PAP.
Right now, in the German state of Bavaria, a controversy is swirling over the fact that “Dozens of party members paid their spouses, children and parents to work as assistants,” wrote the New York Times. See article Nepotism in Bavarian Politics Creates a Scandal Merkel Could Do Without. The loophole was closed in 2000, said the newspaper, but existing employees could continue.
So here too, this is something that is legal, but saying it is legal is not the end of the matter. People at large clearly think it is unethical; thus the controversy.
The ministry’s town council review too makes the same omission, saying again and again that the AIM transaction complies with the law. In fact, the entire report reads as if someone went to town council spokespersons, interviewed them extensively, and wrote up their justifications for what they did. There is not a lot of critical enquiry into what they said.
I even did a search for two words in the 37-page document: ‘ethics’ and ‘ethical’. Both searches resulted in ‘none found’.
The report went some length to play down the value of the obsolescent software that was sold to AIM, thus arguing that town councils suffered no loss. By so focussing on the dollars and cents, the review lost sight of the principle involved.
Indeed, the review doesn’t seem to see anything wrong with selling IP rights to a partisan owner, not only in this case, but in all future arrangements.
Page 15, for example, described how the town councils decided to move to a ‘service model’ wherein “the ownership of the software would reside with an external vendor. The TCs would lease the software from the external vendor and pay for maintenance.” Then it says that AIM would “work with the TCs to understand their redevelopment needs, including looking for a suitable vendor to provide these upgrades.” (Page 16, paragraph 18). This was in reference to the town councils’ need for “third generation software”. It left open the possibility that the final vendor for third generation software could well be AIM again; there is nothing to exclude them.
Just as troubling was the review report’s gentle description of why a one-month termination clause was inserted to provide for the event of material changes in the composition of a town council. It comes right after noting that the general termination clause specified three months’ notice. See page 4 of the report.
It doesn’t at all question why material changes in the composition of a town council must necessitate a special clause providing for such a rushed termination. The reason it offers and endorses – and it probably comes right out of the mouths of town council spokesmen since this reason had been proffered by town councils way back in January 2013 – was “the vendor would have priced its bid on the basis of the existing TC and Town boundaries. However, should this change materially, the vendor could end up providing services to a TC comprising a much larger area and a larger population of residents, but is held to do so at the same fixed price”.
Anyone with half a brain would ask two questions:
1. How much extra work will be involved? The servicing is of the software, which remains the same, and is not all that sensitive to the data load (which correlates with the number of residents)? As far as I know, AIM is not even providing the host servers or the band width.
2. Even if there is some difference to servicing work, is the difference so material that the general three-month notice is unfairly onerous on the vendor, and a rushed termination is justified?
If you are not satisfied that the above two points justify a rushed termination clause, then you must ask, what really was the motive behind it?
This is pertinent, especially as the report itself, in a brief flicker of independence, points out that such rushed termination presents a problem of continuity. By implication, it won’t be in the best interests of citizens and residents. On page 8, it says “The review . . . have surfaced a broader issue of how to ensure continuity of services to residents in the event of a change of MPs.”
I thought this comment, at least, was interesting. Does it suggest that the terms of the contract with AIM were designed to imperil continuity should there be a change of party representing the district?
When National Development Minister Khaw Boon Wan says town councils are necessarily political institutions, is he saying that such motives are acceptable? Is he saying that politics in Singapore can be a no-holds-barred contest? That scorched-earth policies for partisan advantage is acceptable? It would be a road to ruin if this were the case.
We are left with the same questions as in December and January and still no answer.
Yawning Bread 
The Govt is determined NOT to answer those very questions you, and members of the public, blogosphere, and WP raised. They are going through the motions to conduct a “review” and then “debate” it in Parliament (within just 1 sitting, no less).
And just like the media dogs tore into that lady who had that temerity to bed the ex-Speaker in Punggol (instead of tearing into the MP himself), in this case, the media then tears into FMSS instead. The accuser becomes the sinner and becomes the controvesy while the original issue dies a quiet death.
Yes, this is politics and you can play rough. But there’s a cost. For a start, the PAP should discard its white uniform. It was a symbol of a clean govt, of purity. Its now a business organisation – everything is transactional, based on legality.
If it were the other way around, you can bet that the PAP would have jumped head over heels on the WP for transferring public property at zero cost to a political entity. They would have jumped up and down about this being a “character issue” (remember how “character issue” was trumpeted when James Gomez was caught lying?).
The Govt just wants this issue to die. Forgotten. For us to move on.
I guess we do not have a choice. But we should remember this so we vote accordingly in 2016. Remember what? Remember that the PAP is essentially the biggest bully in town and that fundamentally, they are just incapable of change. And oh, they treat citizens with contempt and like idiots when selling their half-cooked explanations.
At least the people in the committee that investigated the transaction deigned to put they names down on the ‘report’. I wouldn’t be forced to put down my name too for such a report.
it is called a variation. when terms of the contract changes, it can always be re-negotiated. it is no cause for termination
In fact, the AIM contract allows AIM to call for a variation of fees (i.e. increase fees) should the town composition change. So why the need for the harsh one-month termination clause??
You hit the nail on the head. They make the laws and use that as their excuse and their protection while ignoring the real issue of ethics. Just goes to show how much or how little they value ethics while proclaiming it important for citizens and children to have it.
Re couldn’t find the words ”ethics” and ”ethical” in review document: Not clear why you expect a govt that is careful to go by the letter of the law to determine if actions are right or wrong, to be guided in what it does by principles or ethics. No reason for these to matter if the law is not broken….
Whatever it is, we now know it is quite easy to run a town council. First you rush out and buy an over the counter IT system, then you plug it in, and… you’re ready!! As such, no consideration of work put in – very little work is required anyway it would seem – needs to be given on this score when we are deciding who to vote for in the next election. So again I’m not clear on why TCs should be a political matter. Hey, any fool can handle one….
Excellent article, Alex. Keep it up.
Alex,
Just want to share a couple critical points made by and questions posed by WP MP in Monday’s Parliamentary seating. One can find the WP MP speeches made at WP website or FB. Thave been blacked out by Staits Times in its biased coverage.
1) Png Eng Huat said that the contract ith AIM allows for price variation due to changes in the composition of a town, so why the need for a 1 month termination clause?
2) Sylvia said that a criterion for the 2010 tender is for the directors of the bidding companies to have town council management experience? Why is there such a weird requirement. Did directors of NCS have town council management experience? Do the directors of the conpany that won the recent tender to develop a replacement TCMS have town council experience?
3) Even without general elections, a town’s composition changes all the time with eg. new BTO development, so why subject TC to a 1 month termination by AIM?
Furthermore,
1) Khaw Bbon Wan claims (in Parliament) that TCMS can be easily purchased off the shelf. Whoa!! If that was true, why did it take the PAP TCs so long to get the “outdated” software replaced? Why spend $25m to develop a software from scratch??? Why call for a tender? Wouldn’t it cheaper to buy it off the shelf?
2) Khaw disingeniously use Mrs Chiam’s past employment at Potong Pasir town council to imply hanky panky at the town council. But he deliberately leave out the crucial fact that Mrs Chiam was just temporarily tanding in for a vacated position and she was employed for just 6 months, during which she drew a salary of just $1,800/month. Khaw should be frank and not take things out of context. The more such stunts he pulls, the more credibility he loses.
If indeed as Khaw Boon Wan claim that AIM is a PAP-backed company that was set up to help its PAP MPs succeed, why the need to have a one-month termination clause as a back up against its own MPs? Unless… A classic example of one lie leading to more and more lies to cover up the ones before. Too bad, Teo Ho Pin did his business but was caught with his pants down, Khaw Boon Wan was then tasked to clean up his shit and ended up getting it all over his own face. Well, he’s paid for it. A true patriot…
Good article. The current ruling party is very good at using unjust or unethical laws to their advantages. Everything is done leegally.
We have to wait until the cow come and still we may not get any answer….the only way is we the citizen of Singapore answer the doubt by casing our vote in election 2016.
In my view, the whole aim of AIM is aimed at tripping whichever opposition party takes over.
In the 2 minutes that I saw Khaw Boon Wan speak in parliament on CNA, I decided that this guy, too, has become the PAP that we know and detest strongly. This was totally different from what I viewed of him 8 years ago. He was shamelessly audacious with his answers.
I suppose someone has to do these kind of dirty work for them. Maybe it kind of explain why they said it is increasingly difficult for them to find such people as they need to be paid obscenely for it. Obviously decent people would do it for all the money in this world. Only those running dogs would sell their souls for a couple of milliion bucks to do it.
Have the same impression and same conclusion as well. Much like Star Wars one character, no ?
If you look at page 33 of the report which contains the letter between AHTC and AIM, you would notice that contrary to the claim that AIM is not making money, it earns money by terminating contracts:
Maintenance&Support(NCS) $27,394.21
Handling Fee @10% (AIM) $2,739.42
Lease-Back Fee (AIM) $785.00
Total (payable to AIM) $30,918.63
Extention 1 Sep – 9 Sep:
Lease-Back Payment $382.50
GST 7% $27.48
Total Amount Due $419.98
So, for every GRC or SMC that the opposition took from PAP, AIM can terminate the contract to collect handling fees which is 20 times the amount it charged for servicing on a monthly basis. Why should this sum of money be paid to AIM in the first place?
Further, it was noted that one of the requirement in the tender document is for all the directors to have town council experience. This effectively rule out all major IT providers in the market just so that only AIM can satisfy the requirement.
That is to say that the devil is always in the details.
My previous company has even taught me the fine art of splitting/awarding major contracts to subsidiary or associated companies so that none of them seems to be making any profit at all.
Defending the indefensible….our AIM scandal defence by Minister Khaw reminds me of the ongoing Benghazi scandal in the US where Obama’s top aides go to extremes to explain away and even justify their actions and non-actions which resulted in the murders of their 4 brave diplomats. Lies and half-truths were told in their cover-up to ensure the re-election of Barack Obama in Nov 2012….
Keep up your excellent critiques, Alex. We look forward to your continuing posts on this Aim scandal.
You have got to admire Mr Khaw’s bravado for defending their MND’s report that is as badly and frivolously constructed as the recent Population White Paper without so much as a facial display of embarrassment. It takes courage or a certain degree of self delusion (i.e., you believe in your party so much that you are willing to believe any bullsh*t that comes from it) to do that.
Or, the PAP has no concept of ‘conflict of interest’. Then again, the PAP also do not understand the concept of ‘basic human rights’, ‘equality’ or ‘justice’.
This involves money belonging to all Singaporeans.
What is the guiding principle here?
Surely the principle has to be that the interest of all Singaporeans are paramount and protected. Any action and decision should be for the benefit of all Singaporeans.
LKY said Aljunied have 5 years to repent and so they went about screwing the residents and framing WP for it.
A “full” review into TC will not reveal any wrong doing when headed by a deputy secretary in the Ministry of National Development, and when the Speaker of Parliament denied the adjournment motion for a full debate on the ministerial statement.
Its not as if the new MPs were not doing their work diligently. They were hampered by dirty politics played by the losing party. Defeated candidates became advisors to grassroots org thus having access to Govt funds. The sabotage by AIM and now the hawker centre cleaning saga, all helped along by taxpayers paid agencies HDB and NEA on the
their side.
The WP should rethink about their strategy of being a co-driver and accomdating to the ruling party when the latter had not been reciprocating
the gesture.
Frankly I think a big section of citizens is tired of all these politicking and charade. If WP is not ready to be in government and continue to be contented with playing second fiddle, some other party should and be given the support.
Do not forget that Khaw Boon Wan is a patriot, who has served in Parliament longer than most, which makes his motives unquestionable, and his ethics unassailable.
Any insinuation otherwise would be arrogant. Because apparently, in his sagely view, the length of his tenure is somehow (through sheer PAP-style mental gymnastics) correlated to the quality of his work.
Ironically, Khaw Boon Wan was borned and raised in Malaysia (i.e. he was previously a Malaysian citizen). He later dump that citizenship and became a S’porean.
I do wonder if he had served NS.
Absolutely disgusting. No moral or ethic shown at all.
They think we have only half a brain !!!!!
There was never any real intention to provide any answer. The conveniently convened “review” had no investigative objectives. It reported nothing new. A charade, a sham, a wayang kelong!
right from the beginning when PM announce this review of town council, the skeptics already predicted the outcome of the review to be of no consequence because nothing will found to be unlawful, and life goes on. So this review outcome is no surprises for the Skeptics, i must say. Should have bet on it with the bookies, damn…
Which Employer/Client with half a brain would sign a service contract with a Vendor allowing the Vendor to terminate at one (1)’s notice ?
The one with a full brain will make sure that any termination shall be at Employer/Client’s discretion and not the other way round, isn’t it ?
They still can’t explain WHY THE FUCK did they can allow this to happen, isn’t it ?
There IS an answer. It is obvious. But as Jack Nicholson’s character pointed out “can you handle the truth?”
“Dozens of party members paid their spouses, children and parents to work as assistants,” wrote the New York Times
The credibility of this government is increasingly in shambles; in this instance, the MSM is not much different from the Malaysian media in the recent elections. The arrogance of Khaw Boon Wan in calling SL arrogant seems unbelievable. If not for MSM propping them up, I am certain more GRCs will be lost especially if credible people like Alex or uncle Leong step up.
Didn’t LKY warn Aljunied residents to repent? This could be one of the ways. Wonder what would happen if this was raised up in Parliament. Childish I know, but then, so was the comment in the first place.
Alex,
Many people aren’t aware that WP had publicly declared the appointment of FMSS way back in August 2011 (news article appended below). The key reasons were: (1) MND has imposed an unrealistically short deadline (by 1 August 2011) for WP to take over Aljunied, (2) The previous MA (CPG Facilities Management) quit immediately after GE 2011. CPG cited the fear of losing its contracts with PAP town councils shoudl they continue to be MA for Aljunied, (3) There are only 3 MAs in the market capable of managing towns, but all 3 are loyal to PAP only.
What the press didn’t highlight is the fact that WP the initial FMSS contract for for just one year (instead of the typical 3 years in the industry). This was done specifically to give WP time to properly conduct a public tender. When WP eventually conducted the tender, only 3 companies collected the tender documents….and only FMSS submitted a bid.
Neither MND nor Teo Ho Pin complained then. So the only reason MND and Teo brought this matter up now is to distract the public from the real issue (i.e. the AIM scandal).
+++++++++++++++++
TODAY
6 August 2011
(c) 2011. MediaCorp Press Ltd.
Given the tight time-frame in which the handover of town councils and the engagement of a new managing agent had to be completed — by Aug 1 — the Aljunied-Hougang Town Council (AHTC) opted to appoint a new managing agent to start work immediately, instead of calling for a tender.
FM Solutions and Services (FMSS) will be the AHTC’s managing agent for a year, said town council chairman Sylvia Lim in a statement last night. While residents have reportedly expressed concern over FMSS’ lack of a track record, Ms Lim described the firm, which was formed in May, as being “qualified and experienced in estate and township management”, with “key directors” who have been in the field for an average of 20 years. To ensure no disruption of town council services, Ms Lim said the AHTC chose a service provider which was qualified and could start immediately.
Ms Lim added that FMSS has re-employed all 22 staff working at the former Hougang Town Council and that former Aljunied Town Council employees are “welcome” to apply for positions. While it was reported that one of FMSS’ shareholders and officers is the secretary of the former Hougang Town Council, Ms How Weng Fan, Ms Lim said no Workers’ Party member has any interest in FMSS.
PAP is stage 4 cancer. It’s terminal and incurable. When the house of cards finally collapses, we will find a zillion skeletons in the closet!
Surely would any one expect an acceptable, reasonable or even plausible answer from a review initiated by the PM assigned to committee under the MND which in turn headed by the PAP party chairman ? Surely such a report has to take into account what impact this report will have on the minister, the PM and the PAP party if there was the slightest hint of wrong doing. I am sure this thought (feeling) must be on the minds of review committee members even before they even held their first meeting.